RBA (Reserve Bank of Australia) went down the same path as other central banks last week and kept rates on hold for now. No surprises here, as the majority of central banks still waiting to see when the Federal Reserve will make their next move and follow suit. On top of that Australia main export channel is China, and with the Chinese New Year commencing in the next few days this will slow down export for the month.
For the remainder of the week, it’s a little slower than its previous. We can still see movements, in particular on GBP pairings. Since Friday after seeing non-farm payroll indicating a strong US labour market, GBP/USD has dropped from highs 1.2770 to its current level of 1.2550. Market census is that GBP can lose further ground against the green back throughout the month, and with an already drop of 1.7% – a potential sell off could stress market expectations.